Monika Miles | TaxConnections

10 Oct 2018

What You Need To Know About The Taxability Of SAAS In North Dakota, South Dakota And Nebraska

Monika Miles- Taxability of SAAS In North dakota, South Dakota, Nebraska

In the wake of the Wayfair decision, there are a lot of questions surrounding sales taxes across the many U.S. states. While many queries we receive revolve around establishing physical presence and nexus for retail items, the next important question a company must always ask is, “If I have nexus, is my product taxable?” In that regard, there are a few areas many business often overlook: Software-as-a-Service (SaaS), cloud computing and electronically downloaded software. Are these items taxable? It depends.

A few months ago we explored the taxability of SaaS, cloud computing and electronically downloaded software in 15 states across the country; today we’re taking a look at the tax ramifications of three more states: North Dakota, South Dakota and Nebraska.

Nexus & Constitutional Issues for Middle America Companies

Following the Wayfair decision, do companies in North Dakota, South Dakota and Nebraska need to pay online sales tax to states in which they’ve established nexus? And if so, what is the tax threshold?

Written by Monika Miles | Posted in Monika Miles • Taxability of SAAS

03 Oct 2018

Kansas Tax And Business Climate

This month brings us to the center of the country, the Great Plains state of Kansas. Kansas is a Midwestern state that epitomizes the U.S. Heartland with its Great Plains setting of rolling wheat fields. The Museum of World Treasures in Wichita, the state’s largest city, covers world history from dinosaurs to Elvis, while the open-air Old Cowtown Museum highlights the city’s pioneer past. In nearby Hutchinson, the Cosmosphere displays the Russian Vostok and Apollo 13 spacecrafts. Read More

Written by Monika Miles | Posted in State Tax

27 Sep 2018

Congress’ New Online Sales Tax Bill: What You Need To Know

Monika Miles, Online Sales Tax, Congress, Online Sales Simplicity and Small Business Relief Act

As we wrote a couple of weeks ago, the online sales tax debate is far from over. Although the Supreme Court ruled that states can impose an internet sales tax, Congress can still legislate on the issue. And it looks like it will. Representatives introduced a bill designed to guide sales tax collection requirements for businesses selling across state lines.

About the Online Sales Tax Bill

Written by Monika Miles | Posted in Sales Tax

06 Sep 2018

North Dakota Business And Tax Climate

This month we travel to the Great Plains state of North Dakota. It is the 19^th largest in area, the 4^th smallest by population, and also the 4^th most sparely populated of the 50 states. North Dakota is situated near the middle of North America with a stone marker in Rugby, North Dakota marking the “Geographic Center of the North American Continent.”

The western half of the state consists of the hilly Great Plains as well as the northern part of the Badlands, which are to the west of the Missouri River. The region is abundant in fossil fuels including natural gas, crude oil and lignite coal. The Missouri River forms Lake Sakakawea, the third largest artificial lake in the U.S.

Written by Monika Miles | Posted in Monika Miles • North Dakota Taxes

29 Aug 2018

What You Need To Know About The Taxability Of SAAS In Northeastern States

Are you curious if you need to be paying taxes on or charging your customers sales tax on your sales of these revenue streams: Software-as-a-Service (SaaS), cloud computing and electronically downloaded software? The answer is, maybe. Because these three areas are defined differently by each state, it’s important to understand how each state’s tax codes approaches them.

Being aware of the tax ramifications in any state your company has established nexus is incredibly important, especially considering the Wayfair decision from earlier this summer. While the U.S. Supreme Court’s decision may seem like it was only directed at online sellers, the truth is that multi-state sellers (such as those generating revenue from SaaS and software) are also affected. Because of the ruling, it will be even easier to establish nexus in more states across the country; companies need to know which taxes they’re responsible for in regards to SaaS, cloud computing and electronically downloaded software.

Written by TaxConnections Admin | Posted in TaxConnections

24 Aug 2018

Economic Nexus In Wake Of Wayfair Decision

In the United States, the sales tax landscape is drastically changing due to the recent U.S. Supreme Court ruling in South Dakota v. Wayfair, Inc. In a previous blog, we talked about how the High Court made a landmark decision in June of 2018 that makes it easier for companies to create nexus in states. It ruled in its monumental decision, that it is constitutional for the State of South Dakota to enact an economic nexus law.

As a result, more states are jumping on the economic nexus bandwagon and enacting economic nexus laws too. States are eager to collect sales tax and, in theory, want to make it easier for companies to pay their taxes. In addition to physical presence, if companies also have economic nexus in a state, that qualifies them to pay sales tax to the state, provided the state has enacted an economic nexus statue.

Written by Monika Miles | Posted in Economic Nexus • Wayfair Decision

16 Aug 2018

What You Need To Know About The Taxability Of SAAS In Midwestern States

Over the past several weeks we’ve been looking at the taxability of Software-as-a-Service (SaaS), cloud computing and electronically downloaded software in various states throughout the country. While some states define these revenue streams as services or tangible items, others are a little less clear, which is why it’s important to understand the tax code for each state in which your business has nexus.

While many SaaS and software companies may assume they won’t be affected by recent sales tax changes, the reality is they will be affected, and they have for years; in fact, following the U.S. Supreme Court’s Wayfair decision earlier this summer, it will be even easier for traditional multi-state sellers generating revenue from SaaS, cloud computing and electronically downloaded software to establish nexus within more states, making it even more important to be aware of how each one treats these items.
Read More

Written by Monika Miles | Posted in SAAS In The Midwest States

14 Aug 2018

Indiana Tax Business Climate And Tax Credits And Incentives

Monika Milkes, Tax Climate And Tax Credits In Indiana

This month we travel to the Crossroads of America, the Midwest state of Indiana. It is known for its farmland and renowned auto race, the Indianapolis 500, held at the Indianapolis motor speedway. In the capital, Indianapolis, theatres and galleries line Massachusetts Avenue. The city’s downtown is home to the iconic Soldiers and Sailors Monument, the Canal Walk promenade and the Indianapolis Museum of Art and its wide-ranging collections.

The state includes two natural regions of the United States: the Central Lowlands and the Interior Low Plateau. The Till Plains make up the northern and central regions of Indiana. Much of its appearance is a result of elements left behind by glaciers. Central Indiana is mainly flat with some low rolling hills (except where rivers cut deep valleys through the plain, like at the Wabash River and Sugar Creek) and soil composed of glacial sands, gravel and clay, which results in exceptional farmland. Northern Indiana is similar, except for the presence of higher and hillier terminal moraines and hundreds of Kettle lakes.

Written by Monika Miles | Posted in Indiana Tax Credits And Incentives

02 Aug 2018

What You Need To Know About The Taxability Of SAAS In Southeastern States

Monika Miles, Software As A Service Taxes

When it comes to Software-as-a-Service (SaaS), cloud computing and electronically downloaded software, do you need to collect sales tax from your customer, or pay use tax on purchases?

Well, it depends. Some states define these as services, tangible property or none of the above; you need to take a look at each state’s statutes, regulations or other guidance to answer the question.

Another important factor to be aware of is the recent Wayfair decision from the U.S. Supreme Court earlier this summer. While it may seem to only apply to online sellers, the ruling will also affect traditional multi-state sellers that generate revenue from SaaS and software. Because the decision makes it easier to establish nexus, companies will need to be very aware of the taxability rules regarding SaaS, cloud computing and electronically downloaded software in any state in which they have nexus.

Today is the third in our series of how various states approach the taxability of SaaS, cloud computing and electronically downloaded software. Keep reading to find out how three states in the Southeast (Florida, Georgia and South Carolina) tax these items, and check out our previous posts details about states in the west!

SaaS and Cloud Computing Rules in Southeastern States

Written by Monika Miles | Posted in SAAS Tax Rules

31 Jul 2018

U.S. Supreme Court Sales Tax Decision (Wayfair) Q&A Part II

The hot news in the sales tax world is the recent U.S. Supreme Court’s June 2018 ruling in South Dakota v. Wayfair, Inc. This ruling overturned the high court’s 1992 decision in Quill (Quill Corp v. North Dakota, 504 U.S. 298 (1992)), which established a physical presence standard before a state could enforce sales tax collection responsibilities on a seller. With the Wayfair decision, the Supreme Court effectively ruled that another indicator of sufficient presence in a state is “economic nexus”. Essentially that means that a certain dollar volume or number of transactions in a state can create nexus and therefore a responsibility on the seller to collect and remit sales tax. In the South Dakota statute, those amounts are SD sales in excess of $100,000 or 200 transactions in the state within a year.

In the last month, we’ve received many questions from our clients and referral partners about what this really means for them and what they should be doing next. We addressed a few of those questions in a previous blog and here, we tackle a few more.

Q: In the month since the decision, have other states already jumped on the South Dakota economic nexus bandwagon?

A: Yes, they have. Several states either already had economic nexus statutes in place before Wayfair (i.e.; Alabama) or had legislation in the works in anticipation of a Supreme Court ruling (or act of Congress) that would allow the economic nexus determination to create substantial presence and a filing requirement. These states have effective measurement dates as noted: Hawaii (7/1/18); Alabama, Illinois, North Dakota and Wisconsin (10/1/18); Georgia and Iowa (1/1/19). We anticipate additional states will join the fray within the next few months.

Written by Monika Miles | Posted in U.S. Supreme Court Sales Tax Decision

27 Jul 2018

What You Need To Know About The Taxability Of SAAS In Southwestern States

Monika Miles, Taxability Of SAAS in Southwestern States

In some ways, state statutes are crystal clear about which goods or services require the collection of sales and use tax. However, when it comes to Software-as-a-Service (SaaS), cloud computing and electronically downloaded software, the laws become a bit more confusing. When does your company need to collect sales tax on these types of transactions?

To further complicate the issue, the recent Wayfairdecision will affect traditional multi-state sellers (including those that generate revenue from SaaS and software) – not just online sellers. By making nexus easier to establish, companies will need to consider the taxability rules of SaaS in each state in which they have nexus even more closely.

Today is the second in a series that covers how various states across the country define SaaS, cloud computing and electronically downloaded software. Read our first post to find out how California, Utah and Washington handle them, and keep reading for three states in the Southwest: Colorado, New Mexico and Texas!

Written by Monika Miles | Posted in Monika Miles • SAAS Taxes

16 Jul 2018

More Amnesty In Wake Of Wayfair Decision

Monika Miles, Amnesty In Wake Of Wayfair Decision

There always seems to be an amnesty program going on somewhere. We recently reported on an amnesty program in Texas and other states are jumping on the bandwagon as well. The recent Wayfair Supreme Court decision has shed light on the requirements to collect sales tax and as a by-product more companies are focusing on getting into compliance. States are encouraging this behavior by administering amnesty programs.

When businesses become delinquent on their taxes, they often accrue penalties and interest with the states. During these amnesty programs, states may waive penalties and/or interest. States administer amnesty programs because they want companies doing business in their state to be compliant and in the process collect the revenue!

Current Amnesty Program in Indiana

The Indiana Department of Revenue (DOR) is offering a Voluntary Disclosure Initiative (VDI) for Online Sellers that started on May 2 and runs through December 31, 2018. According to the Department, this special VDI is tailored to meet the unique needs of retailers that have inventory located in third-party Indiana warehouses and sell to Indiana customers- explaining that many of these retailers selling goods to Indiana customers through service providers have both income and sales/use tax obligations in Indiana. It offers out-of-state retailers the opportunity to enter into a voluntary disclosure agreement (VDA) with unique terms, including a limited look-back period and waiver of underlying penalties.

Written by Monika Miles | Posted in Amnesty Due To Wayfair Decision